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Excavation contributed to Newcrest's Cadia dam failure

Newcrest Mining has been warned that dangerous liquefaction could continue occurring within the giant dam attached to its most important mine, after a review of last year’s tailings dam failure at Cadia found management decisions exacerbated existing weaknesses.

An independent review found a decision to excavate at the base of a 94-metre dam wall played a role in the failure that brought Australia’s most lucrative gold mine to a halt in March 2018.

The Cadia failure was contained within a downstream dam and caused no injuries, unlike Samarco, which killed 19 people and destroyed several Brazilian towns.

But there have been financial and regulatory consequences for Newcrest beyond the three-week operating halt that followed the failure, with the miner still unable to deposit wastes into the dam and having to find waste storage options elsewhere.

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Dr Morgenstern’s panel found that a weak, compressible and brittle section of earth in the foundation layer of the dam wall was “the most significant controlling feature that led to the event”.

But that weak spot, dubbed the “forest reef volcanics”, was placed under further strain when the dam wall was raised for the 10th time in less than 20 years.

Weak foundation

The designers of that 10th raise, contractor ATC Williams, decided that two buttresses needed to be added to the dam wall to improve support and overall safety.

The first buttress was completed on March 5, 2018; four days before the dam wall slumped.

In preparation for the second buttress, a 5.5-metre trench was dug at the “toe” of the dam wall in a bid to extract 1000 tonnes of material that was affected by a burst water pipe.

“This excavation was undertaken in January 2018, exposing weakweathered foundation material. This exposure remained openuntil the time of the event,” said the report.

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Monitoring equipment showed a “marked increase” in movement in the dam wall in January 2018.

“It is of interest to note that this corresponds with the construction of the stage one buttress and excavation at the toe,” said the report.

In a significant win for Newcrest, the expert report downplayed the significance of two earthquakes that occurred close to Cadia the day before the dam failure.

“The (panel) concludes that the earthquakes did not contribute to the onset,” he said.

Seismic events

Cadia ramped up its use of a mining method called panel caving at Cadia in 2013, and Geoscience Australia has since recorded an increased number of seismic events in the region.

Dr Morgenstern’s report effectively soothes concerns that the mining method at Cadia may have caused or contributed to the dam failure.

Sandeep Biswas, chief executive of Newcrest Mining. Bloomberg

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Newcrest intends to reopen the affected dam once regulatory approval is received, and the panel said that would require close monitoring, particularly if further “forest reef volcanics” are found.

“It must be recognised that this [using the dam in the future] implies management of loose, saturated, and potentially liquefiable tailings for the full life cycle of the facilities,” said the report.

Drilling to date has not found any further weak spots in the dam wall, but Newcrest said it would expand geotechnical assessments, introduce extra monitoring equipment and take a more cautious view toward further increases in dam wall height.

“We accept all the findings and recommendations,” said Newcrest chief executive Sandeep Biswas.

Newcrest said on Tuesday it remains on track to deliver between 2.35 million and 2.6 million ounces of gold in fiscal 2019.

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